House of Commons

Monday 14 February 2011

The House met at half-past Two o'clock

Prayers

[Mr Speaker in the Chair]

Oral Answers to Questions

Work and Pensions

The Secretary of State was asked-

State Pension Age (Women)

1. Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab):
What assessment he has made of the likely effects of the proposed change in the state pension age for women. [39800]

The Minister of State, Department for Work and Pensions (Steve Webb):
We published a full equality impact assessment as part of the White Paper on our proposals to bring forward the increase of the state pension age to 66, which sets out the effect on women of those changes.

Tom Blenkinsop:
The coalition agreement states that the parties agree to

"hold a review to set the date at which the state pension age starts to rise to 66, although it will not be sooner than 2016 for men and 2020 for women."

Will the Minister explain why he saw fit to U-turn on that promise and to start to increase the women's state pension age to 66 from 2018?

Steve Webb:
If the hon. Gentleman looks at the process of raising the state pension age to 66, he will find that early in 2020, the age will still be 65 and some months. It will not start to rise to 66 until April of that year.

Mr James Gray (North Wiltshire) (Con):
Although I welcome the equalisation of the pension ages, does the Minister agree that a small group of women born, like me, in the middle months of 1954-a vintage year-will be affected disproportionately by the way in which it is being phased in? Will he look again to see what can be done to help that group of women?

Steve Webb:
My hon. Friend is right that of the 2.6 million women who are affected, 33,000 were born in the vintage months that he describes. That group will have to delay for up to two years before they receive their state pension. One reassurance I can offer is that those women-and indeed he, should he find himself in 14 Feb 2011 : Column 682
that situation-will be eligible to apply for jobseeker's allowance or employment and support allowance, so they will not be left destitute.

Dr Eilidh Whiteford (Banff and Buchan) (SNP):
The Turner commission recommended a 15-year lead-in for such changes. Those women who were born in 1954 will not benefit from that. Does the Minister think that fair?

Steve Webb:
The hon. Lady raises the important point that notice periods are important. The challenge we faced was that the time scale for raising state pension ages that we inherited was staggeringly leisurely. The Conservative party manifesto and the coalition agreement made it clear that we would move faster. The state pension age for men was set at 65 a century ago-I think we need to move faster.

Andrea Leadsom (South Northamptonshire) (Con):
A constituent of mine who has worked all her life and has saved for her own pension falls into the vintage year of 1954. She cannot bring herself to be on jobseeker's allowance at the end of a hard-working career. It seems a little harsh to suggest that as the only outcome.

Steve Webb:
I am grateful to my hon. Friend. Jobseeker's allowance and employment and support allowance are available as safety nets, but I appreciate that that is not what many people will want. The vast majority of the women in this birth cohort are still working. In the world that we are going into, we anticipate that more people will work into their 60s-that is part of the change. Many of them will be able to support themselves, perhaps through a part-time job, to cover the gap in years.

Rachel Reeves (Leeds West) (Lab):
The Minister's response is inadequate. The Government's coalition agreement is clear. Under the Government's plans, the state pension age will start to rise to 66 in 2018, not in 2020 as promised in the coalition agreement. Some 33,000 women, currently aged 56, will have to wait exactly two years longer to get their pension, with little time to prepare. The average retirement savings of those women will provide them with just £11 a week in retirement. They simply do not have the savings to draw on to accommodate these moving goalposts. Does the Minister honestly believe that these changes for women are fair and proportionate?

Steve Webb:
I have common ground with the hon. Lady on two points. First, I deplore the fact that the pensions policies of the previous Government have left women in this group with so little pensions savings to draw on. Secondly, she is right that we could go more slowly. We could, as she has proposed, delay until 2020 before doing anything, but we would then have to find an additional £10 billion that the present schedule provides for us. I have not yet had the letter or parliamentary question from her suggesting where that £10 billion might come from.

Work Capability Assessment

2. Mark Pawsey (Rugby) (Con):
What discussions he has had on changes to the work capability assessment for those with variable conditions. [39801]

14 Feb 2011 : Column 683

The Minister of State, Department for Work and Pensions (Chris Grayling):
We are, as the House knows, committed to improving the work capability assessment so that it is as fair and accurate as possible, including for people with variable conditions. It currently provides for variable conditions, but we are implementing all the recommendations of Professor Malcolm Harrington's independent review. I have asked Professor Harrington to take forward the next review, which will include a detailed look at how the assessment deals with fluctuating conditions, to see whether we can make further improvements.

Mark Pawsey:
The Minister will be aware of the concerns of people who have conditions such as chronic fatigue syndrome, who have good days and bad days. They are anxious to ensure that they receive fair treatment through the work capability assessment, taking account of their ability to complete activities on a regular basis. Can the Minister provide an assurance that the variable nature of such conditions will be fully considered, and that the assessment will identify the appropriate level of support for individuals to enable those who can to get back into work?

Chris Grayling:
I can absolutely give my hon. Friend that assurance. Indeed, I have asked Professor Harrington to work with people who specialise in ME as part of his review. I do not want us to write off everybody with a particular condition. It is important to identify who can potentially work and who cannot, and to provide them with the appropriate support. That is the goal of our policy and what we will seek to do, and I am mindful of the concerns that my hon. Friend raises.

Stephen Timms (East Ham) (Lab):
The sharp increase in job losses forecast this morning by the Chartered Institute of Personnel and Development will make it harder still for people with health conditions to find jobs. Last week, the Minister tabled regulations that modify the mental health descriptors in the work capability assessment, but at the same time, following his acceptance of Professor Harrington's recommendations, to which he has referred, an alternative set of descriptors is being drafted by Mind, Mencap and others. Should he not wait until he has received their advice before he makes changes?

Chris Grayling:
As the right hon. Gentleman knows, we ourselves had one review carried out last year by Professor Harrington, and we also inherited a set of recommendations from an internal review carried out by the previous Government. I considered carefully the recommendations left to us by the right hon. Gentleman and his party, and the internal review recommended changes that would increase the number of people with mental health problems who go into the support group and receive unconditional support. His party was right to make that recommendation, and I am pleased to accept it, but we will take all further steps necessary to ensure that people with mental health problems are treated fairly and properly by the system.

Universal Credit

3. Bob Blackman (Harrow East) (Con):
What assessment he has made of the likely effect of the introduction of universal credit on the level of the couple penalty. [39802]

14 Feb 2011 : Column 684

6. Mr Stewart Jackson (Peterborough) (Con):
What assessment he has made of the likely effect of the introduction of universal credit on the level of the couple penalty. [39808]

The Secretary of State for Work and Pensions (Mr Iain Duncan Smith):
The couple penalty is often slightly misunderstood. It is normally created when a higher benefit rate for single people means that couples are materially disadvantaged by living together. It is generally recognised internationally that a saving is made when two people live together, and the figure given by the OECD and others is about 75% at most. In the UK, under the benefit system left by the last Government, workless couples received only 60% of the benefits received by two single workless people, which I believe put us in the bottom four OECD countries. Simultaneously, the proportion of people forming couples is at its lowest at all income levels, about 15% down against other countries. The Institute for Fiscal Studies recognises that the universal credit will start to make inroads into that problem.

Bob Blackman:
I thank my right hon. Friend. Does he agree that it cannot be correct that two people who choose to live together as a couple should be penalised by £30 a week in benefits? Surely it is better for people to stay together as a family and be able to care for their family together.

Mr Duncan Smith:
From the figures that I have just given and those that we have looked at, there is no question but that the disparity between where the last Government left us and where it is generally accepted that couples should be is the real cause of the problem that is making people live apart, particularly those on lower incomes. I draw attention to the right hon. Member for Birkenhead (Mr Field) and his interesting "Panorama" programme. He is to be congratulated on his work in this area, and he has made the very good point that it is madness that the system drives people apart rather than keeping them together.

Mr Stewart Jackson:
There is a welcome across the House for the universal credit, not least because of the impact it will have on low-paid couples in my constituency and across the country. Will my right hon. Friend, on this particular day, reaffirm his commitment to supporting and advocating fiscal incentives for the institution of marriage?

Mr Duncan Smith:
My hon. Friend knows very well that the issue of fiscal incentives is one for the Chancellor, and I will certainly pass his comments on to the Chancellor and the Prime Minister. When it comes to the benefits system, Members of all parties should recognise the invidious position that even though we know children and elderly people do better where families with two parents work together for them, the system is driving couples apart. That surely cannot be right, and I hope that the matter will unite Members on both sides of the House, as I am sure the right hon. Member for Birkenhead does.

Mr Frank Field (Birkenhead) (Lab):
Does the Secretary of State accept that perhaps the most significant social security reform that he could introduce, if we are concerned 14 Feb 2011 : Column 685
with the safe nurturing of children, would be the elimination of the penalty against couples?

Mr Duncan Smith:
I agree that that is an objective that we want to work towards. Clearly, any such change has financial implications, as the right hon. Gentleman knows. As I said, the good thing about universal credit is that it starts the process of eradicating the couple penalty, particularly for people on low incomes. I pay tribute to him, because he has gone on about this for longer than anybody else-perhaps everybody is now listening. He is absolutely right that we must surely not force couples apart, but help them to stay together.

Luciana Berger (Liverpool, Wavertree) (Lab/Co-op):
Does the Minister accept the findings from the Institute for Fiscal Studies that the incentives for lone parents to work more than 16 hours per week will be reduced under the universal credit?

Mr Duncan Smith:
I welcome the IFS report, which was a fair one. The IFS was positive about the universal credit-most of all, it said that the universal credit is a progressive measure, because it helps the people who are worst off, many of whom, of course, are lone parents. The answer to the hon. Lady is that, yes, some further up the income scale will see a slight change in their marginal deduction rates, but those down in the lower deciles will see a net benefit to their take-home pay.

Mr Speaker:
Michael Connarty? Not here.

Older People (Employment Support)

5. Grahame M. Morris (Easington) (Lab):
What support he plans to provide to help older people remain in or return to work. [39806]

The Secretary of State for Work and Pensions (Mr Iain Duncan Smith):
People are living longer, healthier lives, which is good news. The state pension age, as the hon. Gentleman has heard, is set to increase over the coming years. I believe that older workers bring a wealth of talent and enterprise, which we should welcome. From April, jobcentres will have more flexibility to help older people, but the key thing is that in getting rid of the default retirement age, we will strike a blow for older people, which should be welcomed.

Grahame M. Morris:
Notwithstanding the excellent work carried out by organisations such as the Shaw Trust in my constituency, which helps people with disabilities into the labour market, the Office for National Statistics has found that the number of retired people aged under 65 increased by 39,000 between September and November on the previous quarter. Does the Secretary of State share the concerns of Ros Altmann, the director-general of the Saga group, who said that the Government risk consigning older people to unemployment benefit by increasing the retirement age in such a tough jobs market?

Mr Duncan Smith:
I believe not that Ros Altmann is materially wrong, but that the jobs market will improve. That improvement will create greater incentives for people. People have a tendency to think that it is a 14 Feb 2011 : Column 686
simple fact that older people entering the work force somehow take jobs away from younger people, but there is no evidence internationally that that happens. The reality, in fact, is that older people staying in the work force increases work flexibility and improves the number of jobs that are available, and helps younger people. The Government have done a lot for pensioners, and we will do more, but ending the default retirement age is about giving older people the right to work for longer, and the responsibility to employers to deal with them as human beings and not just figures on a piece of paper.

Mark Lancaster (Milton Keynes North) (Con):
As part of a back-to-work programme provided by A4e, one of my constituents, who was a senior building site manager, was asked to add £1 to £4.75, which he did not feel was particularly constructive in helping him to get back to work. When will we move away from that one-size-fits-all back-to-work programme?

Mr Duncan Smith:
My right hon. Friend the Minister of State is doing that just now. The Work programme will be tailored to people's needs and not implemented flatly. If people have a problem, the programme will deal with them. Jobcentres will be given more flexibility to ensure that they match employment to the person as necessary. My hon. Friend should therefore welcome the changes that we are making.

Pensioner Poverty

7. John Howell (Henley) (Con):
What steps he is taking to reduce levels of pensioner poverty. [39809]

The Minister of State, Department for Work and Pensions (Steve Webb):
We have restored the earnings link for the basic state pension and given a triple guarantee that the basic state pension will increase by the highest of earnings, prices or 2.5%. We are also protecting key benefits for older people and working to ensure that older people receive the help to which they are entitled.

John Howell (Henley) (Con):
My hon. Friend may recall the "Tackling Pensioner Poverty" report produced by the Select Committee on Work and Pensions in the previous Parliament. The Committee was concerned that many pensioners who are entitled to pension credit are simply not claiming it. What measures are the Government taking to ensure that support reaches those who need it most?

Steve Webb:
One thing we are considering is whether the data we hold about people can be used better. We are therefore undertaking a modest research study, drawing on data that my Department and Her Majesty's Revenue and Customs hold to see whether we can identify people who look as if they ought to be getting pension credit but who are not doing so. We will then make automatic payments to them, and test how that works over a pilot period, on which we will report in the summer.

Emma Reynolds (Wolverhampton North East) (Lab):
Rumour has it that the Minister believes that introducing a universal pension will be a solution to many of the problems in the pension system. If that is the case, why 14 Feb 2011 : Column 687
has he not published the Green Paper we were promised in December? Is it because he is facing some resistance from the Treasury?

Steve Webb:
I am grateful to the hon. Lady for raising that point. I can do no more than quote my right hon. Friend the Chancellor, who told the House in November:

"The Treasury is working with the Department for Work and Pensions on potential pension reform that could simplify pensions and provide a boost to pensioners for many years to come."-[ Official Report, 16 November 2010; Vol. 518, c. 726.]

How right he was.

Apprentices

8. Kevin Brennan (Cardiff West) (Lab):
What steps he is taking to increase the number of apprentices employed by his Department. [39810]

The Minister of State, Department for Work and Pensions (Chris Grayling):
The Department continues to be actively supportive of the apprenticeship programme and believes that it represents excellent value for taxpayers' money and helps people progress in their career. There are 316 people currently working towards the qualification in the Department. Last year, we adapted our recruitment processes to target young unemployed people without work experience and created 23 apprenticeships in our corporate IT directorate.

Kevin Brennan:
The Minister will be aware of the great work done by the last Government, which led to that programme of bringing young apprentices in, and rescued apprenticeships from withering on the vine. Will he commit the Department to carrying on the work that I undertook as apprenticeships Minister, along with people such as Lord Knight of Weymouth-as he is now-to ensure that young people, and not just those in work, are recruited to the Department and given apprenticeship opportunities?

Chris Grayling:
I very much agree with the hon. Gentleman. One of the sad things about the previous Administration was that they never actually supported the number of apprenticeships that they announced. We intend to make a difference and to deliver more apprenticeships-we have announced an extra 50,000 already this year. I can give a clear commitment that the Department will continue to support the apprenticeship programme, both practically and through our relationship with the Department for Business, Innovation and Skills.

Laura Sandys (South Thanet) (Con):
I have been written to by a 16-year-old who has done the right thing by taking an apprenticeship, but having done so, she has found that her family's benefits have been reduced by £90 a week. Will the universal credit address such discrepancies and this discrimination against those who want to work and take up apprenticeships?

Chris Grayling:
My hon. Friend highlights the chaos that we inherited in the benefits system that can lead to perverse incentives that often mean that work does not pay. The universal credit is designed to ensure that work always pays. I would be interested to meet my hon. 14 Feb 2011 : Column 688
Friend to talk about her constituent's case, so that I may understand more clearly what has gone wrong, but we are clear that work must always pay.

Mr Liam Byrne (Birmingham, Hodge Hill) (Lab):
The recession has now been over for a year. Unemployment should now be falling, and the whole House is worried that it is in fact rising, especially among young people. One of the ways in which we tackled that was with the "Backing Young Britain" campaign, which created thousands of job opportunities for young people, including apprenticeships and internships. One of those schemes was a paid internship in the private offices of every Minister in the Department. Is that scheme still in place?

Chris Grayling:
As I have said, we already have 300 apprenticeships throughout the Department and we intend to continue to deliver that support to apprentices. We inherited from the previous Government a collection of programmes that simply were not working. The future jobs fund, for example, cost twice as much as apprenticeships. We believe that expanding the number of apprenticeships-50,000 extra this year and 75,000 extra by the end of the Parliament, plus additional apprenticeships for 16 to 18-year-olds-will move us to the place we should be, and out of the mess that we inherited from the previous Government.

Mr Byrne:
I am grateful for that answer and I will try to decipher it later.

I was interested to hear the Minister talk about how he is now using the Department's resources wisely. At some point, he will no doubt tell us why in December his Department spent more on stationery than it did on employment zones or access to work programmes. I wonder whether that is part of an innovative new approach that includes getting more people into study by cutting education maintenance allowances and getting more young people into work by cutting the future jobs fund. I see now that the Conservative party is piloting new ways of helping young people get into internships, by auctioning them for £5,000 a time to Tory party donors. Did the right hon. Gentleman choke on his pudding when the auctioneer's hammer came down, and when will this worthwhile scheme go nationwide?

Chris Grayling:
I will not take any lessons on spending from a previous Administration who spent money like there was no tomorrow. We were shocked to discover how the Department for Work and Pensions under the previous Administration spent money like there were no limits. This Administration have removed the absurd restrictions on work experience that meant that young people lost their benefits if they did more than two weeks' work experience. We have changed that and are actively finding experience opportunities for young people, not standing in their way and preventing them from accessing those opportunities.

Universal Credit

9. David Rutley (Macclesfield) (Con):
What assessment he has made of the likely effect of universal credit on incentives to work. [39811]

14 Feb 2011 : Column 689

The Secretary of State for Work and Pensions (Mr Iain Duncan Smith):
The objective of the universal credit is that work should definitely pay for the majority of people-as many as possible-but certainly it should pay most significantly at the highest levels for those on the lowest incomes.

David Rutley:
The vast majority of people on benefits do not want to stay there for the rest of their lives. Will my right hon. Friend confirm that the universal credit, with support from the Work programme, will help people in Macclesfield to get back to work, and ensure that it pays for them to go on working?

Mr Duncan Smith:
Absolutely. The interaction between the universal credit and the Work programme is critical. In a sense, one without the other will not work as effectively. The purpose of the universal credit is to ensure that entering the world of work becomes much easier, because people will retain more of their own money: we will be lowering marginal deduction rates. In some cases, on average, those in the bottom two deciles will see an increase in their weekly pay of about £25 a week after they enter work-a significant increase. The Work programme, which my right hon. Friend the Minister of State was talking about, will help with those who are more difficult to place. For the first time, they will get a tailored programme that helps them to deal with their problems, and gets them into work and maintains them there for up to a year, and in some cases more.

Ms Karen Buck (Westminster North) (Lab):
Will the Secretary of State confirm that the Government intend to save £1.3 billion between now and 2015 by reducing the child care element of the tax credit? Will the universal credit be sufficiently resourced to ensure that no working parent out of the 488,000 households that stand to lose anything up to £30 a week will be any worse off than at present?

Mr Duncan Smith:
We are returning the levels on the child issue that the hon. Lady is talking about to the levels left by the previous Government in 2006. It is all very well for the Opposition to nit-pick and say that they are desperately in tune and on side with all those people who are going to feel the squeeze, but in reality the Labour party now has a leader who was responsible, with his colleagues, for spending money like there was no tomorrow. That has left us with a major deficit, and now we have to get that money back. If she does not like what we are doing, please can she tell us where she would intend the money to come from?

Disability Living Allowance

10. Pamela Nash (Airdrie and Shotts) (Lab):
What recent discussions his Department has had with disability organisations on the removal of the mobility component of disability living allowance from those in residential care homes. [39812]

12. Stephen Twigg (Liverpool, West Derby) (Lab/Co-op):
What recent discussions his Department has had with disability organisations on the removal of the mobility component of disability living allowance from those in residential care homes. [39814]

14 Feb 2011 : Column 690

13. Sheila Gilmore (Edinburgh East) (Lab):
What recent discussions his Department has had with disability organisations on the removal of the mobility component of disability living allowance from those in residential care homes. [39815]

The Parliamentary Under-Secretary of State for Work and Pensions (Maria Miller):
My officials and I have discussed the proposals with regard to the mobility component of disability living allowance with a wide range of disability organisations, and disabled individuals and their families. This has included visiting and discussing the proposals with care home residents. These discussions have taken place in the context of the wider public consultation on DLA reform that is currently under way.

Pamela Nash:
I thank the Minister for her answer, although I do not think that it will do much to allay my constituents' fears about the impact on them of the DLA cuts. I am happy that she mentioned that the Government have been in discussion with disabilities charities. More specifically, however, what discussions has she had with those charities about families with children in residential care homes and the impact on them? Those families will no longer be able to take their children out at weekends and in school holidays.

Maria Miller:
So that we are clear, I should say that the Government are talking about retaining spending on DLA at the same level as last year-that is after a 30% increase in expenditure over the past eight years under the Labour Government. With regard to the implications for children living in residential care settings, we are obviously looking at the details, but I can assure the hon. Lady that the intention behind the policy is very much about removing overlaps, not mobility, in the provision.

Stephen Twigg:
Two blind people came to my advice surgery on Saturday who were very concerned about the impact of this proposed change on their independence. Have the Government made an estimate of the number of blind or visually impaired people who will be affected by this change?

Maria Miller:
I am sure that the hon. Gentleman is aware that, given the way that disability living allowance works currently-and certainly given the way that we are looking to take it forward-we are assessing the barriers that people with a disability face, not the condition itself. Obviously, people who are blind or partially sighted face a range of barriers, but they might also have multiple conditions. That is why it is important to look at all those conditions and why, in putting forward for the first time an objective assessment for DLA or its successor benefit, we will be able to ensure that people really get the support that they need.

Sheila Gilmore:
Will the Minister not agree to put the proposal on hold until she has carried out a thorough study of the viability of having local authorities step into the breach; or it is only proposals concerning trees that this Government put on hold, not proposals affecting vulnerable people?

14 Feb 2011 : Column 691

Maria Miller:
I can absolutely assure the hon. Lady that we are looking in great detail at the impact of all our DLA measures. I have been to talk to residents in care homes and their family members, and what I found was an array of ways in which disability living allowance is used. All hon. Members will want to ensure that the most vulnerable members of our society are left not with a benefits system that was designed for people living in family home settings, but with one designed for how people are living now and for their mobility needs.

Mr David Ward (Bradford East) (LD):
Many disabled people in residential care use the mobility component of DLA to ensure that they remain part of their local and wider communities. It was quite disappointing to hear a comparison drawn recently between those in residential care and those in hospital, many of whom are totally immobile, albeit for only a short period. Does the Minister agree that that was an unrealistic comparison, and can she say what assessment has been made of the mobility requirements of disabled people in residential care as compared with the requirements of those in hospital?

Maria Miller:
My hon. Friend is absolutely right: people living in care homes have distinct mobility needs, and having gone out and spoken to residents, I have seen that at first hand. We need to ensure that we have a system that really meets those needs, and is not simply a sticking plaster for lots of other issues that may be forthcoming in the care homes sector. As with so many aspects of DLA, we are dealing with a benefit that is rooted in the past, not in the way people think about disability issues today. I hope that I can work with him on any examples from his constituency of how we can make it work better.

Mr David Evennett (Bexleyheath and Crayford) (Con):
Will my hon. Friend confirm that fairness and reasonableness will be the main considerations when she finalises her reform proposals?

Maria Miller:
My hon. Friend will know from all the work that we have done and the consultation paper that we have put out that we want disability living allowance to continue to support disabled people to get into work and overcome the barriers that they face in their lives, and to ensure that the system works for today, not for 18 years ago, when it was first put in place.

Duncan Hames (Chippenham) (LD):
I sincerely hope that the Minister has been in listening mode during her consultation on the proposals. Constituents of mine have told me that car manufacturers offer discounts to the disabled, who use their DLA mobility component qualification to demonstrate their eligibility for these discounts. What consultation has she had with the industry to ensure that under her proposals, those in care homes do not find themselves having to pay more than the rest?

Maria Miller:
I know that independent travel can be an important way for care home residents to achieve their objective of living more independently. We need to challenge the way that disability living allowance supports that at the moment, which could well include talking to motor manufacturers.

14 Feb 2011 : Column 692

Margaret Curran (Glasgow East) (Lab):
Will the Minister specifically address the comparison with hospitals, which was quite wrong and has been described by the Disability Alliance as "offensive"? The cut would produce a saving equivalent to less than one sixth of the bankers' bonuses about to be handed out at RBS. Will she think again about this cut, or do we have another lady who's not for turning?

Maria Miller:
I thank the hon. Lady for her question-I think. I would reiterate the point that I made earlier, which is that the changes to disability living allowance finances that we are talking about would mean keeping expenditure the same as it was last year, after eight years of a 30% increase. Overall, she has to keep that in mind. What we will do is ensure that we remove any expenditure overlaps, as she would expect us to do, and as I had hoped the previous Government would do.

New Enterprise Allowance

14. Stephen Metcalfe (South Basildon and East Thurrock) (Con):
How many new businesses he expects to be created as a result of the new enterprise allowance in the first 12 months of its operation. [39816]

The Minister of State, Department for Work and Pensions (Chris Grayling):
Over the first two years of its operation, the new enterprise allowance is due to support the start of around 40,000 new businesses. In its second year, we expect the majority of those start-ups to take place in the first few months, when the new enterprise allowance is being rolled out in those parts of the country that are particularly affected by unemployment.

Stephen Metcalfe:
The best way to deal with unemployment in my constituency is to build businesses, and I therefore welcome the introduction of the new enterprise allowance. Will my right hon. Friend confirm that the allowance will provide unemployed people with mentoring, as well as financial support, to enable them to start their own businesses?

Chris Grayling:
I can indeed confirm that. What makes the new enterprise allowance different from all its predecessor schemes is that it will offer people who are seeking to start new businesses specialist support from people who have been there and experienced enterprise. We want to see voluntary sector groups that already offer mentoring become part of the scheme, and we want experienced business people to come forward and become mentors, perhaps through their chambers of commerce. This could make a huge difference to getting people off benefits and into self-employment.

Jobcentres/Voluntary Organisations (Collaboration)

15. Julian Smith (Skipton and Ripon) (Con):
What plans he has for collaboration between jobcentres and voluntary organisations. [39817]

The Secretary of State for Work and Pensions (Mr Iain Duncan Smith):
We were pleased last week to announce the new partnership between Jobcentre Plus and the voluntary sector generally, which will help people to get back to work. Prince's Trust advisers and other local voluntary organisations will start to have a desk that 14 Feb 2011 : Column 693
they man in jobcentres in the next few weeks, and that provision should be available pretty much around the country in April. This will be enormously helpful in tying the voluntary sector in to some of the most difficult people.

Julian Smith:
Does the Secretary of State agree that voluntary groups can help jobcentres to help jobseekers? The Skipton and Ripon Enterprise Group, a group of leading business men in my constituency, is keen to help mentor jobseekers now. What advice can my right hon. Friend give to its members?

Mr Duncan Smith:
First, what we are doing will really open the door to the voluntary sector's engagement in the whole process. As my hon. Friend knows, the Work programme that the Minister of State, Department for Work and Pensions, my right hon. Friend the Member for Epsom and Ewell (Chris Grayling) has been working on has the voluntary sector embedded at the heart of how it will deliver its work. The desks in jobcentres that will be manned by representatives of the Prince's Trust should open up the door to such people being able to see jobseekers as they come in. My hon. Friend should advise people to look at using provisions such as the enterprise allowance and, if necessary, to come and see my right hon. Friend the Minister about any other advice they need.

Ian Paisley (North Antrim) (DUP):
While the benefit system is undergoing change and reform, what plans does the Secretary of State have to change the delivery mechanism for benefits? Will he ensure that it remains customer focused, local and accessible?

Mr Duncan Smith:
At the moment, the vast majority of people-about 98%, I think-receive their benefit payments directly into their bank accounts. There is a small number of people who are still, for various reasons, in receipt of cash payments. A proposal was left to us by the previous Government on how all this can be delivered in the next few years, but we have not made a final decision on it yet. We will announce our decision very shortly.

Robert Halfon (Harlow) (Con):
I am grateful to the Government for allowing a pilot scheme for local jobcentres to give out food bank vouchers from the food bank charities. Will my right hon. Friend ensure that the scheme that emerges is as simple and unbureaucratic as possible, so that the jobcentres in Harlow can receive food bank vouchers as soon as possible?

Mr Duncan Smith:
I would not dare do otherwise, with my hon. Friend breathing down my neck on this one. It is due to his hard efforts and pressure that we have made this particular change, and I think that it is for the good. Of course, it is important that it does not become a substitute for anything else, but it will certainly be there if people feel that they need that extra assistance, and there is no reason why we should not do it.

Gloria De Piero (Ashfield) (Lab):
Has the Secretary of State made any representations to his colleagues about the proposed closures of voluntary organisations that support and train people to return to work, such as the Diamond centre in my constituency?

14 Feb 2011 : Column 694

Mr Duncan Smith:
We constantly discuss, in Cabinet and other forums, the idea of what we are doing with the voluntary sector and how we can best help and support it. We are putting a lot of money behind the voluntary sector right now, and the Work programme will make a significant amount of money available to the sector through back-to-work programmes. Of course there are difficulties in the sector, as some local councils choose to start with voluntary organisations when they make their reductions. Personally, I often wonder whether local councils too often see the voluntary sector as an add-on, rather than as an incredibly effective and integral way of delivering good services, and I hope that they will think again about some of those changes.

Minimum Wage

16. Mr Christopher Chope (Christchurch) (Con):
What account his Department takes of the effects of the level of the minimum wage in its business planning processes. [39818]

The Minister of State, Department for Work and Pensions (Chris Grayling):
Departmental business planning processes take account of the minimum wage in the potential effect on the future pay bill and in departmental contracts. For some years, the Department for Work and Pensions has targeted pay awards towards our lower paid staff, and the lowest level of pay for directly employed DWP staff is currently £7.27 an hour compared with the 2010 national minimum wage of £5.93 an hour.

Mr Chope:
Does my right hon. Friend agree that one way of making the big society even bigger would be to give freedom to individuals to take employment with charities at below the minimum wage?

Chris Grayling:
I have to say that I do not share my hon. Friend's view. What I would say to employers up and down the country is that I hope they will take advantage of the increased numbers of apprenticeships that are paid at special apprenticeship rates in order to allow people to develop the skills they need to build future careers.

Mr David Hanson (Delyn) (Lab):
Will the Minister assure the House that during internal Government discussions he will support the minimum wage that the Labour Government introduced and make sure that for each year over the next four years it rises by at least the level of inflation?

Chris Grayling:
As the right hon. Gentleman knows, Conservative Members have supported the national minimum wage for many years-and will continue to do so.

Housing Benefit Reforms

17. Stella Creasy (Walthamstow) (Lab/Co-op):
What recent representations he has received on his proposed review of housing benefit reforms. [39819]

The Minister of State, Department for Work and Pensions (Steve Webb):
We have had, and have responded to, many representations on the review of the housing benefit reforms. Most recently, my noble Friend Lord 14 Feb 2011 : Column 695
Freud met with Lord Best to discuss the review and our intention to commission a team of independent, external researchers to undertake the task.

Stella Creasy:
The Secretary of State will be well aware of the severe and long-term shortages of housing currently faced in Waltham Forest, as in many London boroughs. Given that there are 1,500 people aged 26 to 35 currently in receipt of housing benefit in Waltham Forest, where does he think they will be living next year if his plans to change the shared room rate go through?

Steve Webb:
One consequence of the reforms to housing benefit will be that the local housing market will change. We anticipate, for example, that some of the larger properties might find themselves converted into houses in multiple occupation, although we do not know exactly what will happen. One problem is that over many years we have seen inadequate house building taking place under the hon. Lady's Government.

Matthew Hancock (West Suffolk) (Con):
In the Public Accounts Committee, we heard from civil servants about the impact of housing benefit and other benefits that make for an extremely complex and complicated benefit system. We have also heard about the enthusiasm for having a universal benefit as a way of cutting through that. Talking of representations, would not these changes have been easier had we not had representations on where the money was left?

Steve Webb:
My hon. Friend is quite right that Labour Members' answer to most questions is "more money", but when we asked where the money had gone, we were told that there was none. Housing benefit is probably one of the most complicated benefits in the system; it is at the end of the line when everything else has been worked out. The sooner we can integrate it into universal credit, the better.

Hywel Williams (Arfon) (PC):
On Friday, I met a group of residents at a hostel run by the North Wales Housing Association. Those people have very little prospect of employment in an area of such high unemployment, yet they might face a reduction in their benefits. Does the Minister accept that that sort of cut might threaten the viability of hostels such as the Pendinas hostel that I visited on Friday?

Steve Webb:
The budget for discretionary housing payments across the country will be trebled over the coming years, so that additional funding will be available for particular difficult cases. One thing we want to do is enable people to get back to work, where jobs are available, and the universal credit process will increase the financial return and people who take low-paid jobs will have a greater ability to afford somewhere to rent.

Work Programme

18. Dame Anne Begg (Aberdeen South) (Lab):
If he will put in place provisions to ensure that the expertise of small employment providers is retained in the transition from existing employment programmes to the Work programme. [39820]

14 Feb 2011 : Column 696

The Minister of State, Department for Work and Pensions (Chris Grayling):
I am pleased to inform the House of two things. First, the Work programme bidding process closed this morning, and we have had a substantial number of bids, which is very encouraging. It looks as if the Work programme is going to go ahead according to plan, which is good news. I would also say to the hon. Lady that, shortly before the start of these parliamentary questions, I placed a written statement before the House, giving details of an extension to the welfare-to-work contracts under existing programmes through to next June. I have also written to the hon. Lady and her Committee, setting out the details of those changes. We believe that we have now put in place all the mechanisms needed to ensure a smooth transition through to the start of the Work programme, which remains very much on track.

Dame Anne Begg:
I am glad to hear that my letter has had some effect, but will the Minister confirm that the contractors who are currently delivering Pathways to Work and whose contracts are due to expire at the end of March will not have to issue redundancy notices to their staff in the next couple of weeks, because they will be able to continue until they know whether they will be part of the Work programme?

Chris Grayling:
Transitional arrangements will involve the existing providers in all programmes except Pathways to Work. In that instance, we are setting up an interim support programme which will be more substantial than such programmes have been in the past. As the hon. Lady will know, Pathways to Work was severely criticised by the Public Accounts Committee. Our interim arrangements will cover those who would otherwise have received support through Pathways.

Mr Speaker:
I call Mr Douglas Carswell. He is not here, so I call Mrs Mary Glindon.

Youth Unemployment

The Minister of State, Department for Work and Pensions (Chris Grayling):
Over the past few months there has been a fall in the number of young people claiming jobseeker's allowance. However, we remain extremely concerned about youth unemployment. We are introducing measures through the Work programme and our work experience plans, and other measures through Jobcentre Plus, in order to provide the best possible support for young people who are struggling to find employment.

Mrs Glindon:
Nearly 25,000 18-to-24-year-olds are claiming jobseeker's allowance in the north-east, and young people account for more than 30% of the unemployed population in the region. Can the Minister assure me that there will be enough funds in the Work programme to guarantee that those young people will be helped into employment?

14 Feb 2011 : Column 697

Chris Grayling:
I share the hon. Lady's concern. The fact that 600,000 people who left school and college under the last Administration have yet to find work is a huge problem that we must address. We are providing specialist back-to-work support through the Work programme, earlier than has been the case under previous programmes and after three months for some young people with the most challenged backgrounds. I can assure the hon. Lady that that will remain a priority for the present Administration.

Topical Questions

T1. [39825] Stephen Metcalfe (South Basildon and East Thurrock) (Con):
If he will make a statement on his departmental responsibilities.

The Secretary of State for Work and Pensions (Mr Iain Duncan Smith):
As I did not do so earlier, let me now welcome my shadow, the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), to his post. I hope that we shall have engagements in the future, and I am sure that he will adopt a positive approach to measures that he believes will benefit the estate.

Mr Liam Byrne (Birmingham, Hodge Hill) (Lab):
There will not be a hair of difference between us.

Mr Duncan Smith:
Indeed. I am glad to see that the right hon. Gentleman models himself very much on me, which is also very helpful.

I have had meetings today, and I have more meetings to come. I should also mention that we are getting rid of the default retirement age, which we consider to be a positive move overall for older people which should also help to boost the economy.

Stephen Metcalfe:
What advice or consideration has been given to small and medium-sized enterprises on how they should handle the removal of the statutory retirement age, and what advice can the Secretary of State give businesses on managing employees with physically demanding jobs?

Mr Duncan Smith:
The default retirement age is unlikely to have been used by many small and medium-sized enterprises; it tended to be used by larger businesses. Once it has been removed, employers should be able to dismiss staff, while obviously using the ordinary fair dismissal rules under the Employment Rights Act 1996. When employers can demonstrate that a retirement age is objectively justified, they can make a case for setting one. The key point, however, is that many large and many small companies have never used the default retirement age. They will argue that working with employees to secure a proper programme as they head towards their general retirement age is a positive move, and that employees should not be left lying there until the employer has to get rid of them.

T4. [39828] Mr David Hanson (Delyn) (Lab):
I recognise that the Secretary of State has made representations about the £1.5 million of bonuses paid to Remploy directors this year. Let me also say, before he mentions it, that that payment was originally agreed under the last Government. However, does he think it 14 Feb 2011 : Column 698
insensitive of directors to take £1.5 million in bonuses when in my part of the United Kingdom some 540 staff are potentially at risk of redundancy?

Mr Duncan Smith:
The honest truth is that I do not think it a good idea for people to do that in the present climate. There is currently a public sector pay freeze, we are imposing limits on bonuses, and I am asking staff in one of the lower-paid areas of Government to forgo some of their future pay rises. My simple answer to the right hon. Gentleman is this: I wish that those who are thinking about acting in that way would think again, and I also wish that I had not been left in such an invidious position by the last Government.

T2. [39826] Stephen Mosley (City of Chester) (Con):
Opposition Members have spent the past 50 minutes calling, in almost every question, for more Government spending, yet just nine months ago we famously heard the shadow Secretary of State say that there was no money left. Given the shadow Secretary of State's willingness to offer honest advice, might my right hon. Friend reciprocate the favour and offer his own advice to his new opposite number?

Mr Duncan Smith:
Given my political career, I have given up giving advice to anybody, so the best thing the shadow Secretary of State can do is forge his own way and I will look to see how I can dismantle that.

T5. [39829] Pamela Nash (Airdrie and Shotts) (Lab):
On Friday, I visited the Reeltime youth and music group in my constituency, where I met three young men who had got their jobs through the future jobs fund. They feel that the FJF is a great success for them, and so did the group. The Scottish Labour party agrees, and has today announced that it will create 10,000 places if it wins in May. Will the Government reconsider scrapping the FJF, or do they still believe youth unemployment is a price worth paying?

The Minister of State, Department for Work and Pensions (Chris Grayling):
I sometimes think Opposition Members simply do not listen. First, as we have just heard, the Labour party left behind for us the most monumental financial mess, so there are not large amounts of money in the kitty to pay for the best support we could possibly deliver or all the things that we would like to do. The reality is that we have chosen to divert the money that we have into paying for apprenticeships. We have announced tens of thousands of extra apprenticeships, as we believe that they are a much better way of delivering support to young people. There are huge numbers of opportunities for young people to take advantage of an apprenticeship and build a proper career, and there will be more and more such opportunities as the spending review goes by.

T6. [39830] Caroline Dinenage (Gosport) (Con):
It concerns me when I meet constituents who have given away quite sizeable chunks of money to their children just as they approach retirement in the hope that the Government will then support them through their retirement. What steps are the Government taking to encourage people to save more for their retirement?

14 Feb 2011 : Column 699

The Minister of State, Department for Work and Pensions (Steve Webb):
We are pressing ahead in the Pensions Bill with measures to make the process of automatically enrolling people into workplace pensions a reality, so from 2012 over a four or five year period, getting on for 10 million people will be enrolled into workplace pensions for the first time with an employer contribution. We believe that that will transform the savings landscape, and we need to make sure it pays to save.

T9. [39833] Yvonne Fovargue (Makerfield) (Lab):
Recently, a constituent contacted me regarding his Atos Healthcare assessment. Three specialists had considered him to be unfit for work, yet it was suggested that he could be a bingo caller or a car park attendant. My local citizens advice bureau has identified many such cases which are resolved in favour of the claimant after an expensive review or appeal. Are there any plans to review Atos Healthcare's delivery of medical assessments?

Chris Grayling:
As the hon. Lady will know, soon after taking office we commissioned Professor Harrington to conduct a full review of the work capability assessment and the process around it. He has recommended a number of changes, which we are implementing as quickly as possible. I stand by the view that the assessment is the right way of helping people who have got the potential to get back into work. It is much better for those who can be in work to be so, rather than sitting at home on benefits, but we obviously have to make sure that the process is fair, just and proper and that we get the most accurate results possible.

T7. [39831] Priti Patel (Witham) (Con):
Given the news that there are more than 150,000 illegal immigrants claiming sickness benefits and maternity pay and that Europe is now threatening legal action under human rights legislation against this Government for planning to restrict those benefits, can Ministers give a clear assurance that the Government will stand up against Europe on this matter?

Chris Grayling:
I can give my hon. Friend an absolute assurance on that. It is clearly absurd that illegal immigrants can access our benefits system. It is another example of the chaos we inherited from the previous Administration. I am the person who represents the Department for Work and Pensions and the Government in the European Employment Council, and my hon. Friend has my absolute assurance that I am fighting our corner to maintain the integrity of our welfare system, and will continue to do so.

T10. [39834] Jack Dromey (Birmingham, Erdington) (Lab):
Some 21% of the young people in Erdington are unemployed, the Connexions office in Erdington high street has closed, projects funded by the working neighbourhoods fund and the future jobs fund now face closure, and 13 advice centres also face closure as a consequence of council cuts. There is therefore increasing despair among young people. Some years ago, the Secretary of State made a journey to a housing estate in Glasgow. Will he agree to receive a delegation of the young unemployed from Erdington, so that he can hear from them first hand just how mistaken his Government's policies are?

14 Feb 2011 : Column 700

Mr Duncan Smith:
Of course I will be happy to receive any delegation that the hon. Gentleman wishes to bring forward. The Government are absolutely clear about their determination to help get young people back to work. When he made his statement he must have recalled that only a few months ago his Government left us with almost the worst youth unemployment since records began. It is remarkable that under his Government youth unemployment rose during a period of growth. That is not much of a record for him to crow about.

T8. [39832] Jessica Lee (Erewash) (Con):
I want to raise the issue of family breakdown. My constituents often tell me that family breakdown involves not only the emotional turmoil of dealing with it, but the complexities of sorting out the financial arrangements and the accompanying delays. I would be grateful if the Minister would set out for the House the steps that the Government are taking to create a structure to ensure that parents can take financial responsibility for their children.

The Parliamentary Under-Secretary of State for Work and Pensions (Maria Miller):
I thank my hon. Friend for her question. I refer her to the consultation paper on the future of the child maintenance system in this country, which we have been consulting on in recent weeks and through which the coalition Government are looking to provide more choice and support for parents, so that they can take responsibility on reaching maintenance agreements. We are also offering further services, such as a calculation-only service, and a new and improved statutory scheme, which will be stronger. Overall, we are trying to ask parents to take more responsibility. I remind the House that the previous Labour Government endorsed this approach and I remind Labour Front Benchers that Lord Hutton said that he was

"convinced that in general and in principle"-

charging-

"should form part and parcel of"-

the Child Maintenance and Enforcement Commission's-

"approach".

Indeed, we are following his advice-

Mr Speaker:
Order. I am extremely grateful to the Minister.

Mrs Anne McGuire (Stirling) (Lab):
Given that transport facilities offered by residential care establishments normally relate to social and care needs, not independent choice, could the Minister explain how the removal of disability living allowance from those in residential care is consistent with article 20 of the United Nations convention on the rights of persons with disabilities, to which this country is a signatory? Has she assessed her policy against the commitment to the convention?

Maria Miller:
I can assure the right hon. Lady that we have assessed our policies in the right ways. I reiterate what I have said to her before, which is that the policy is trying to remove overlaps, not mobility.

Jake Berry (Rossendale and Darwen) (Con):
In my advice surgery on Friday, a young couple came to see me in Darwen to say that they were £30 a week worse off for living together. It is a shameful legacy of the 14 Feb 2011 : Column 701
previous Government that people are worse off for living in couples and worse off when they go back to work. What this couple and everyone else in Darwen wants to know the answer to is: when will the universal credit end this situation?

Mr Duncan Smith:
My hon. Friend is right to say that this is one of the most invidious unintended effects of a benefits system, and this country found itself in a worse situation on the couple penalty that most others did because of the interplay and complexity of that benefits system. The universal credit will not immediately end all that, but it will make the situation much better for couples. When couples want to stay together, the Government should never be the thing that forces them apart. The right hon. Member for Birkenhead (Mr Field) has made that clear and I back him up on it completely.

Kate Green (Stretford and Urmston) (Lab):
Block contracts with care homes often leave individual care plans unclear on what mobility costs are to be met by the home. What guarantees can Ministers give that no disabled person in residential accommodation will find their ability to leave their own home reduced as a result of the removal of the mobility component of disability living allowance?

Maria Miller:
Again, I reiterate that we are looking to remove overlaps, not mobility. The local authority contracts contain clearly articulated requirements for care homes to cover activities of daily living, which include providing access to doctors, dentists and local services, such as libraries and banks. In addition, in order to become registered, a care home provider has to undertake to promote the independence of the disabled people living in the homes that it is providing. We know, as do care home providers, that mobility is an important part of that independence.

Amber Rudd (Hastings and Rye) (Con):
This morning I met the BBC-the business breakfast club-in Hastings, which is a group of local employers. It raised with me its concern that when offering additional work to part-time employees of 16 hours, those employees often do not want to take it up because they find themselves worse off. Will the Secretary of State advise what will be done to even that out and make sure that work does pay after 16 hours?

Mr Duncan Smith:
The objective of the universal credit is that, all the way up the part-time process, whatever the number of hours worked, work should pay. That is particularly so for those who take jobs with low hours and low pay, paying them extra. They will be the greatest beneficiaries of the system. It is invidious that there are only two points in the cycle at which people are able to take up work and make any money. In future, work should pay: that is the incentive and we should get people back to work by doing that.

14 Feb 2011 : Column 702

Katy Clark (North Ayrshire and Arran) (Lab):
The Minister mentioned the consultation on the Child Support Agency, which includes the suggestion that both parents should have to pay for use of that agency. Many parents on low income need to go to the CSA. Will not such charges, if they go ahead, simply be a tax on their children and mean that there is even less money to bring those children up properly?

Maria Miller:
Let me make it absolutely clear that there will be very clear ways in which such families can come to their own arrangements without incurring charges. If they feel that that is not possible, the statutory system will be there. Just to reassure the hon. Lady-the charges being put in place are only a fraction of the costs incurred in running the system. Indeed, the up-front charge for individuals on benefits that we are proposing is just one tenth of the cost of processing an initial application.

Fiona Mactaggart (Slough) (Lab):
The Minister has made much of her proposal to remove the mobility component from residents of care homes as one that will reduce overlaps, but there is one group of people for whom there is no overlap at all-children who are in boarding schools because they have special needs. Will she drop that proposal in relation to such children?

Maria Miller:
I reiterate that we are still in consultation on this proposal and are listening carefully to all the issues that people raise. It is vital for children to stay in contact with their parents. The provisions for schools to do that are very clear and we will make sure that when school facilities are not available, there remains an ability to be eligible for disability living allowance, because children would not necessarily be resident in the home.

Mr David Winnick (Walsall North) (Lab):
Despite all these fine words, have Ministers seen the complaints that have been much publicised in the past few days that the people being targeted are those with multiple sclerosis and other very acute disabilities? Some of those people have said that if their allowances and benefits are taken away, so severe is their illness that they wonder whether life will be worth living. It is a disgraceful state of affairs that people with the most severe illnesses are being targeted in the current campaign.

Chris Grayling:
I would say this to the hon. Gentleman: our goal is to do the right thing by people who can make more of their lives. This is not about taking support from people who need indefinite support. We will make sure that people on incapacity benefit who need support and cannot work will continue to be in the support group and will receive a higher level of benefit payment than at present. For those who have the potential to work, we will give them the specialist help they need to do so.

14 Feb 2011 : Column 703

Building Schools for the Future

3.33 pm

John Cryer (Leyton and Wanstead) (Lab) (Urgent Question): To ask the Secretary of State for Education if he will make a statement on his assessment of the High Court ruling on Friday to the effect that the decision to cancel the Building Schools for the Future programme in Waltham Forest and other areas was illegal.

The Secretary of State for Education (Michael Gove):
I am grateful for the opportunity that this urgent question gives me to repeat the points made in my written ministerial statement of Friday.

On Friday, Mr Justice Holman handed down a judgment on the judicial review brought by six local authorities, including Waltham Forest, following my decision to cancel BSF projects in their areas. It was, of course, deeply regrettable that any building projects had to be cancelled, but the scale of the deficit we inherited meant that cuts were inevitable, and the inefficiency that characterised BSF schemes meant that we needed a new approach. All the local authorities that pursued the action agreed that cuts had to be made, but, as the judge records, they argued that

"other (unidentified) projects should have been stopped rather than theirs".

The claimants argued that Government decision making was confused and irrational, but the judge made it clear that the decisions I made were clear and rational. He said that

"the Secretary of State intended to draw, and did draw, a clear demarcation between situations where there were obligations under contract and those where there were not. The decision is not open to challenge on irrationality."

The claimants argued that the chosen cut-off date for projects was wrong, but the judge also made it clear that

"a cut-off date of January 1st reflected government-wide policy and helped to achieve that policy by making very large savings."

The claimants also argued that there was a breach of promise in stopping their specific projects, but the judge said:

"I do not consider that there was any failure...because there was no such promise or expectation."

I am grateful that on all those substantive points, the judge found as he did, in our favour.

On two procedural grounds, the judge ruled in favour of the claimants. In essence, his view is that my consultation with 14 local authorities in relation to 32 sample schools and a further 119 individual academy projects did not go far enough, and that I should have included the six claimants in my consultation. He also judged that I should have had rigorous regard to equalities considerations in reaching my decision.

The judge has not ordered a reinstatement of funding for any BSF project, nor has he ordered me to pay compensation to any of the claimants. Instead, he concluded that I must give each of them an opportunity to make representations, and then review the decision, in so far as it affects these six authorities, with an open mind. I am happy to do so. The judge has made it clear that

"the final decision on any given school or project still rests with"

14 Feb 2011 : Column 704

me, and that I

"may save all, some, a few or none".

He concluded by saying that

"no one should gain false hope from this decision".

I am grateful to the judge for that direction, for the fair and careful manner in which he appraised the evidence, and for his support for the Government on the substantive decisions that we took.

John Cryer:
I want to emphasise, first, that the purpose of the urgent question was not to score points, but genuinely to elicit information, and secondly, that the court action was not taken light-heartedly but because, in the case of my local authority, Waltham Forest, we felt that there was no option as the urgency had become so great.

In my constituency, which is not unusual, seven schools were due for rebuilds-George Mitchell, Buxton, Belmont Park, Norlington, Connaught, Leytonstone and Lammas, which is on the boundary between my constituency and that of my hon. Friend the Member for Walthamstow (Stella Creasy). We were also expecting a new school to be built to deal with the rising demand for places in secondary school. That brings me to the crux of the argument, which is that by 2014 we will be 500 places short in secondary schools. That is a minimum. Waltham Forest is usually a recipient of migration from central London, which means that the actual demand could be 600, 700 or perhaps more. At present, 500 is the bare minimum.

There are three other points to be considered. One is that the structure of many of the schools in question is dreadful and literally falling apart. Teachers, pupils, governors and other staff have fought valiantly, and BSF was the light at the end of the tunnel until it was taken away. Secondly, a number of the schools that I mentioned serve some of the most deprived areas in London, which means some of the most deprived areas in Britain-areas that are struggling with all sorts of problems. Thirdly, some of the schools were on the verge of being decanted, expecting the work to start. In the case of Leytonstone, the school was hours away from moving students to other premises in the expectation that building work would start.

I want to ask a number of specific questions. What is the time scale for finding a replacement and addressing the judgment? Will the Secretary of State approach the matter with an open mind? He has already said that he would, but I want him to reiterate that. Will he consult openly with the schools and the local authorities, but in a fairly tight time frame because matters are becoming so urgent? Lastly, the argument is not about bringing back BSF. We recognise that it has gone, but as he said, we expect a replacement to be announced, and so far that has not happened. When will a replacement be announced?

Michael Gove:
I am grateful to the hon. Gentleman for the fair way in which he makes the case on behalf of his constituents. I should point out that Waltham Forest has already received £68 million from BSF, but I appreciate, as he rightly says, that there are many schools in Waltham Forest which are not in the state of repair that either he or I would wish to see.

The hon. Gentleman makes the point that by 2014 Waltham Forest secondary schools will be 500 places short. I am sure that he, like me, is aware that many 14 Feb 2011 : Column 705
primary schools across London are short of places. We must balance the need to ensure that there are places in secondary schools with investment in primary schools, which BSF did not cover.

The hon. Gentleman asked three specific questions, one of which was about the time scale. I have already been in touch, through my Department, I understand, with Waltham Forest. We want to make sure that we can receive proper representations on behalf of the local authority and its schools in a way that enables us to make comprehensive judgments in the most rapid time available. For that reason, in response to his second question, I will of course keep an open mind and will be keen to hear from him, other Waltham Forest Members and anyone with an interest in the decision. His third question was on consultation with the local authority and the relevant schools. I will be in touch with the local authority to find the most expeditious way of ensuring that the judge's directions can be followed.

Tony Baldry (Banbury) (Con):
However exemplary the Secretary of State is in being fair-minded, is not the reality that all the consultation in God's creation will not create money where money simply does not exist? The point about the whole programme is that it was worse than bankrupt, because it cost £250 million without a single brick being laid.

Michael Gove:
My hon. Friend makes a very good point. Unfortunately, under the previous Government, the BSF budget increased from £45 billion to £55 billion, yet only 8% of the school estate that was supposed to be renovated was renovated. We must have a more efficient way of ensuring that school buildings can be repaired, maintained and rebuilt, and that is what we intend to do.

Andy Burnham (Leigh) (Lab):
The High Court has ruled the Secretary of State guilty of an abuse of power, but anyone listening to him for the first time today would not have thought so. There is still not one word of apology. If he does nothing else, will he at least put that right by apologising to the communities that are suffering the devastating effects of his defective decision making?

Fresh doubts have been raised about the Secretary of State's competence and judgment. To restore confidence, will he now publish all relevant submissions and advice related to that decision? Did he overrule official advice to consult before making those decisions? Will he confirm reports that a leading QC warned him that the councils had a fairly strong case against him? Why, then, did he proceed regardless, and how much public money has been wasted on legal costs? The judge requested a rerun with an "open mind". The Secretary of State's self-justifying response on Friday suggests that his mind is firmly made up. To give the six councils confidence of a fair hearing, should he not now remove himself from any further part in the decision?

This is a damning verdict on a Cabinet Minister by a High Court judge. We saw the same on school sport, Bookstart and the education maintenance allowance: snap decisions, no consultation. The Secretary of State is a repeat offender, dragged here yet again. Is he not now in the last chance saloon, with a clear warning to change his ways?

14 Feb 2011 : Column 706

Michael Gove:
I am grateful to the right hon. Gentleman for the way in which he responds to the judgment. He refers to an abuse of power, but he will be familiar with the fact that "abuse of power" is a judicial term that has been in use since 1603 and, in particular, has been applied in judicial review cases since 1985. It has been applied to Cabinet Ministers on both sides of the House. It is a matter of open debate that judicial review is there to ensure that decisions taken by Cabinet Ministers can be reviewed in the Court. As I said, I was delighted that in this case, on the substantive points, the judicial review found in the Government's favour.

The right hon. Gentleman asks whether all relevant submissions will be published. All relevant submissions were disclosed in the proceedings and looked at by Mr Justice Holman. He had an opportunity, unlike the right hon. Gentleman, to read the evidence and concluded that the judgment that we made was entirely rational, and he backed us on the substance.

The right hon. Gentleman asks about legal advice that referred to the fact that councils had a strong case. That legal advice, as I have informed him and other right hon. and hon. Members, referred specifically to the 32 sample schools in the 14 local authorities that we consulted. All of those sample schools went ahead. The consultation was right and proper in that respect. I am afraid that, as is so often the case, he is misinformed, jumped to a conclusion and, as a result of asking a question to which he knows the answer is not the one he anticipated, has sadly made another mistake.

The judge acted in accordance with all the evidence and found that, on the substance, the right decision was taken. An opportunity now exists for me to review the decisions in the six local authority areas. As I have said before, I intend to do so in an open-minded way and to take advantage of the judge's direction in order to hear their case.

Sir Alan Beith (Berwick-upon-Tweed) (LD):
When the Secretary of State carries out that review, will he keep in mind the claims of those schools that were excluded from the Building Schools for the Future programme and might be in more urgent need of repair than those that were included, such as the Duchess's community high school in Alnwick?

Michael Gove:
My right hon. Friend makes a very good point. One of the weaknesses of the way in which Building Schools for the Future was designed was that it did not prioritise schools on the basis of dilapidation; they were prioritised according to other, political criteria. There are of course schools in Building Schools for the Future areas which are in desperate need of renovation, but there are also schools outside those areas, such as the Duchess's school in Alnwick, which are in a similarly dilapidated state-a consequence of the failure to invest money efficiently over the past 13 years.

Mr John Spellar (Warley) (Lab):
The Secretary of State's initial remarks seem to indicate an attitude that the play was a success, but the audience was a failure. He did, however, move on and offer to look at those decisions with greater care. He will know that Sandwell is a hugely deprived borough with growing school rolls, and that many of its schools were told year on year that they could not have improvements because they were part of BSF. Will he now look at those cases again? People 14 Feb 2011 : Column 707
are faced with crumbling schools and, frankly, dashed hopes. Will he now listen to Sandwell's representations in order to remedy that gross injustice?

Michael Gove:
I appreciate the passionate and effective way in which the right hon. Gentleman makes his case. I had the opportunity to talk to Sandwell's council leader on 5 August, when he brought a delegation of teachers, parents and young people to the Department for Education, and I am very, very happy to ensure that, in the process that we now have, I listen fairly to all the representations made by Sandwell and its Members of Parliament.

Oliver Colvile (Plymouth, Sutton and Devonport) (Con):
The Building Schools for the Future programme was put together according to political criteria rather than any state of dilapidation. Does my right hon. Friend feel that that was right?

Michael Gove:
My hon. Friend makes a very fair case. As I mentioned earlier, some local authorities and schools in the Building Schools for the Future scheme were badly in need of investment, and I, like all right hon. and hon. Members, am sorry that the money simply is not there to invest in every school that needs it. But, as my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith) quite rightly makes clear, the school estates of many local authorities outside BSF were also in need of renovation.

Stella Creasy (Walthamstow) (Lab/Co-op):
Regrets will not solve the problems of many Walthamstow schools affected by the judgment-problems including asbestos, leaky roofs and a lack of space for the curriculum. It was for precisely those reasons that on 12 July I asked the Secretary of State to come to Walthamstow himself. Will he now, finally, in the light of the decision, make good on that and see for himself the issues that BSF was trying to deal with in Waltham Forest? Then, we might finally have schools that are fit for purpose in our borough-unlike the Secretary of State, who it appears is not fit for purpose, according to the judge.

Michael Gove:
I am grateful to the hon. Lady for making her case. Waltham Forest, as an effective and efficient local authority, has already been in touch with my Department, and I am delighted to say that we will be in conversation with it to ensure that the right judgment is made in due course. But, with respect to the hon. Lady and all Opposition Members, although many schools are in desperate need of rebuilding, the question that must be asked is, "Why weren't those schools rebuilt effectively in the last 13 years, and why did the Building Schools for the Future scheme operate in such a wasteful and inefficient fashion?"

Damian Hinds (East Hampshire) (Con):
Sixty million pounds spent on consultants; £1,625 per pupil spent on IT. Would my right hon. Friend say that Building Schools for the Future represented the very best way of spending money for the future education of our children?

Michael Gove:
My hon. Friend, who serves on the Education Committee, has made a study of the waste inherent in Building Schools for the Future, and he is 14 Feb 2011 : Column 708
right: it is a scandal that, while buildings, as the hon. Member for Walthamstow (Stella Creasy) pointed out, were in a state of decay, unfortunately millions of pounds were spent on consultants. One individual, in one year, made more than £1 million as a result of his endeavours as a consultant working on Building Schools for the Future.

Mr Dennis Skinner (Bolsover) (Lab):
Is it not becoming increasingly obvious that last year the Secretary of State took the decision to abandon all those schools under Building Schools for the Future in too much haste? As a result, he has had revised lists-I think there were six in all-and now this court judgment. We have a school in my area, more than 100 years old, being held up by pit props. A contract was made with the builder, but the case is still waiting to be decided. His junior Minister said that it is a compelling case, and there must be scores like that all around Britain. Why does he not stop the arrogance and get on with the job?

Michael Gove:
The hon. Gentleman says on the one hand that we acted with unprecedented haste, and on the other hand that we should get on with it. One of the reasons we acted as we did is that the scheme we inherited was wasteful and inefficient. I should point out that as a direct result of changing the scheme we have been able to ensure that a school that was part of Building Schools for the Future, in the constituency of the right hon. Member for Doncaster North (Edward Miliband), is going to be built one year faster than it would have been under Labour, with 30% savings. Under this coalition Government, we are making the savings and beating the time scales to ensure that in the most deprived areas, the schools are built.

Andrew Bridgen (North West Leicestershire) (Con):
Is it not the case that despite the huge amounts of money spent on BSF projects before a brick was even laid, the Government architecture watchdog judged that 88% of those projects were either mediocre or not good enough? Does not that underline how badly managed the scheme was under the previous Government?

Michael Gove:
My hon. Friend makes a good point. The Commission for Architecture and the Built Environment made it clear that far too many of the designs were not up to scratch under the previous Government. We want to make sure that every young person has a school that is fit for purpose. That was not the case under the previous Government.

Stephen Twigg (Liverpool, West Derby) (Lab/Co-op):
The priorities for BSF were set according to social and economic deprivation and educational underachievement. Is the Secretary of State really saying that those are the wrong priorities when deciding what educational investment should be? Liverpool schools have been hit hard by last year's announcement. A month ago, I wrote to the Secretary of State inviting him to visit St John Bosco school in my constituency-one of the schools that was affected by the announcement. Will he, or one of his colleagues, visit that school at his earliest convenience?

Michael Gove:
I am grateful to the hon. Gentleman for making the case. Initially, the Building Schools for the Future criteria were exactly as he described, but 14 Feb 2011 : Column 709
subsequently they were altered so that readiness to deliver became a factor. That meant that, for a variety of reasons, the money was not always targeted at the areas most in need. He has made the case for St John Bosco and for other schools in Liverpool very effectively. One of my ministerial colleagues or I will make good on the promise to visit Liverpool.

Mary Macleod (Brentford and Isleworth) (Con):
Does my right hon. Friend find it outrageous that under the slow and over-complex BSF process, it usually took about 30 months before construction began? What can he to do ensure that the process is simpler and more efficient for schools such as Chiswick community school and Hounslow Manor school in my constituency?

Michael Gove:
My hon. Friend makes the very good point that it took 30 months from the moment of starting the process to the first brick being laid. In the project that we have used as a pilot in Doncaster North, the procurement process took just 10 weeks and the school will be delivered one year ahead of schedule. If that is not proof that there was inefficiency in the existing scheme that we inherited, I do not know what is.

Mr Jim Cunningham (Coventry South) (Lab):
Will the Secretary of State tell us when he is going to make an announcement about a replacement for BSF for Coventry schools? A large number of our schools are dilapidated or have scaffolding around the buildings, and this situation cannot go on. I do not want him to blame the previous Government. You are in charge now. You put this question earlier: what did we do over the past 13 years? Well, we had 18 years of your previous Government when capital programmes were cut.

Mr Speaker:
I am not in charge of anything other than the chairing of this session, but I look forward to what the Secretary of State has to say.

Michael Gove:
The hon. Gentleman, along with the hon. Member for Coventry North West (Mr Robinson), met me last summer to make the case for Coventry, and he did so very effectively. I appreciate that a number of schools in Coventry need investment at some point in the future and have suffered as a result of the way in which the BSF timetable has operated. We hope that the James review into the allocation of capital will be published shortly-as I said, some of the pilot projects have shown that there is significant scope for savings-but naturally I want to make sure, as part of this process, that we can receive the submissions from the local authorities cited in this case.

Mr David Ward (Bradford East) (LD):
Under phase 3 of BSF, 19 school projects in Bradford were frozen. I am sure that the Secretary of State will agree that it was a cruel deceit to sign off phase 3 just before the general election when there was no money available to build those schools. However, is it not also cruel to spend new capital money on free schools before we first meet the needs of the schools tied up in BSF?

Michael Gove:
My hon. Friend makes a balanced point. The point I would make about free schools is that in the work that we have done so far, we have established that we can cut significantly-by up to 50%-the costs 14 Feb 2011 : Column 710
of providing school places. There is a proposal for at least one free school in Bradford, and it will be considerably cheaper than BSF schools. I hope that he will work with me to ensure that all new schools that are built-whether free, maintained or academy-are value for money and admit students on the basis of social justice and equality for all.

Kelvin Hopkins (Luton North) (Lab):
The Secretary of State will be aware that Luton was one of the six authorities covered by the High Court action; the specific school was the Cardinal Newman Catholic school in my constituency. I visited that school on Friday and spoke at length to the head teacher. It is desperately overcrowded and has poor facilities, as is the case with all high schools in Luton. It is not so long ago that Luton had the highest proportion of school-age children in the country. In reconsidering these building projects, will the Secretary of State consider overcrowding and the lack of school capacity?

Michael Gove:
The hon. Gentleman makes a good case. I am well aware of the problems that affect Luton's schools. I shall, of course, look closely at the case that he, other Luton Members and Luton's local authority have made.

Charlie Elphicke (Dover) (Con):
In Dover and Shepway, £2.9 million was spent on consultants. One Kent bidder spent £5 million on a bid only to lose. The scheme was a bureaucratic nightmare and a complete fiasco. Does the Minister agree that it was a fiasco? Who was responsible for this fiasco and are they in the Chamber today?

Michael Gove:
My hon. Friend asks a series of questions, but I must resist the temptation that he extends to me. We all know that the scheme had to be reformed. Those who embarked on Building Schools for the Future did so for the best and most idealistic of reasons. Those who made promises immediately before the last election, which no Government could honour, must look to their own consciences.

Stephen Timms (East Ham) (Lab):
The Secretary of State has assured us that he will keep an open mind in receiving representations from the six authorities, including Newham. I ask him to take a close look at the cases of Plashet school and Little Ilford school, whose pupils made a DVD to show him the state of their buildings. Renewal now would avoid continuous costly patching up. Should it not be allowed to go forward?

Michael Gove:
The right hon. Gentleman makes a good case. I have had the opportunity to visit schools in his constituency and I appreciate the challenges that teachers face there. One reason why these six local authorities brought the case was that they were among the closest to the finishing line when the line was drawn. By definition, wherever the line was drawn, those closest to it would have felt the most acute sense of injustice; also by definition, those closest to it would have been among the most needy. Wherever the line was drawn, there would have been a feeling of grievance. I understand the feeling of grievance in Newham and I take on board the points made by the right hon. Gentleman and others.

14 Feb 2011 : Column 711

Robert Halfon (Harlow) (Con):
Is my right hon. Friend aware that the BSF scheme spent £20 million on a school in Essex that closed a few years later? A local authority official said that all the money had been spent, but that they had no idea where it had gone. Does my right hon. Friend agree that that shows the failures of the BSF scheme?

Michael Gove:
My hon. Friend underlines the fact that under Building Schools for the Future, the capacity of local authorities to spend money as they saw fit took second place to the diktats of a centralised bureaucracy. As a result, there was inefficiency, which meant that public money was not spent as effectively as it should have been on raising standards.

Helen Jones (Warrington North) (Lab):
Given that the Secretary of State's actions have been judged an abuse of power in relation to six local authorities, does it not follow that there was an abuse of power in relation to other authorities whose BSF projects were cancelled and which have not yet taken legal action against him? Will he commit to review all BSF projects that were cancelled, including the building projects at two schools in Warrington that serve the most deprived areas of my constituency? If he will not, is he not open to the risk of further action from other local authorities?

Michael Gove:
That is an understandable response from the hon. Lady, but the judge was clear that only the local authorities that received a specific form of approval after 1 January and that took part in this action were governed by it, and that no other local authority should consider that it is in time or within its rights to bring a judicial review.

Andrea Leadsom (South Northamptonshire) (Con):
Will my right hon. Friend explain why, in spite of having schools with the same leaky roofs, dilapidated classrooms and overcrowding as those described by many Opposition Members, my constituency was told that there was no chance of even being considered for a BSF project for the next five to 10 years?

Michael Gove:
My hon. Friend repeats a concern that many hon. Members on both sides of the House have expressed-that the process by which individual schools and local authorities were selected for entry into Building Schools for the Future, even though it might have been conceived idealistically, in the end was not seen as fair. We need to ensure that the successor scheme guarantees that money is spent effectively and efficiently on those in the most need.

Mr Adrian Bailey (West Bromwich West) (Lab/Co-op):
The residents of Sandwell have been let down twice by the Secretary of State. First, it was announced that Sandwell schools would be unaffected by the cuts, only for that to be rescinded a few days later. Secondly, he undertook to visit Sandwell to explain what had happened and then decided that he would not do so. Will he do something to restore the faith of the people of Sandwell in the Government's intention by agreeing to make the consultation and review process totally independent, so that he is not left in the position of reviewing his own previous bad decisions?

14 Feb 2011 : Column 712

Michael Gove:
I am grateful to the hon. Gentleman for that point. He, along with the leader of Sandwell council, Sandwell teachers, parents and young people, was able to come and meet me in the Department, and he made the case for the schools in his local authority very effectively. An opportunity now exists for the decision to be reviewed, but the judge was quite clear that that decision should be taken by the Secretary of State.

Matthew Hancock (West Suffolk) (Con):
I welcome the very reasonable tone of the Secretary of State's response to the reasonable judgment. Does he agree that it is not reasonable to ask pupils to be educated in schools that are falling down, or that after 13 years of a Labour Government, they see dripping wet rain coming in and, in some cases, skylights falling in, because dilapidation was not as significant a factor in the scheme as it should have been and affected schools were therefore not eligible for BSF funding?

Michael Gove:
My hon. Friend makes a very strong point. I note that while he was talking about dilapidation and making the case for reform of how we allocate capital with passion and urgency, Opposition Front Benchers were laughing. They might consider that this is an appropriate subject for levity, but I believe that they should reflect on their record in office and consider why, after 13 years and after they inherited a golden economic legacy, so few schools were in a fit state. Was it anything to do with any of the mistakes that might have occurred on their watch?

Pat Glass (North West Durham) (Lab):
To return the Secretary of State to the judgment, which was about consultation, will he give us details now of what consultation he will carry out with the six local authorities involved? Will it include children and young people themselves and their families?

I noted from the Secretary of State's response to my hon. Friend the Member for Warrington North (Helen Jones) that the judgment does not rule out other local authorities that incurred expenditure also taking legal action. Will he consult those local authorities?

Michael Gove:
I am grateful to the hon. Lady for her point. The judge was clear that it is only with respect to the six local authorities in question that I have to consult, and that no other local authorities are either in time or entitled to mount a judicial review. The manner of the consultation with those local authorities is very much a matter for them to outline in conversation with me and the Department, but I want to ensure that the process is as fair and expeditious as possible. With respect to other local authorities, such as those in Durham, I have of course had the opportunity to visit her constituency and that of the hon. Member for North Durham (Mr Jones) to see the specific case for investment outside BSF, which I know may be necessary.

Mr Andy Slaughter (Hammersmith) (Lab):
The Secretary of State will know that schools in Hammersmith and Fulham lost £200 million in well worked-up, mature BSF proposals. Instead, we have free schools enrolling pupils, despite the fact that they have no approved business case, their consultation is not complete and 14 Feb 2011 : Column 713
they have no secured site. Will he reconsider decision making in Hammersmith and Fulham before he is back in the High Court?

Michael Gove:
I am grateful to the hon. Gentleman for his point. I have had the opportunity to visit with him many of the outstanding schools in Hammersmith and Fulham, including Phoenix high school, which we both hold in high regard. The new free school that is likely to be opened, the West London free school, is being opened at a significantly lower cost than that for which schools were built under BSF. It will be in a handsome building adjacent, I believe, to the fee-paying independent school Latymer upper, where he enjoyed such a great education.

Grahame M. Morris (Easington) (Lab):
I hoped that the Secretary of State would be able to bring us sunshine today in relation to some of the schools that have been affected, particularly Seaham school of technology, which suffers from terrible problems of dilapidation. The opportunity cost of not replacing the school and having to fund the repairs is considerable. It is the only school serving a quite large town, and it has rising demand. Will the Secretary of State consider the case for that school?

Michael Gove:
I am grateful to the hon. Gentleman, not only for proving that he is a reader of The Times,and a fan, like I am, of Sarah Vine's writing, but for making the case for investment in east Durham. I have had the opportunity in the past couple of months to visit the north-east twice, and I always enjoy doing so. He makes an impressive case. I know that with Building Schools for the Future gone, we must all look at how we can get money to the schools that need it in the best way. I also know that in Seaham and Easington there are schools that desperately need investment at some point in the future.

Lilian Greenwood (Nottingham South) (Lab):
Staff at Trinity, Bluecoat and Fernwood schools in my constituency are desperate for extra investment in their buildings. Will the Secretary of State say when he will meet Nottingham city council to review our city's excellent case for that additional investment?

Michael Gove:
At the earliest possible point.

14 Feb 2011 : Column 714

Middle East

4.5 pm

The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague):
Mr Speaker, with permission, I shall make a statement on recent developments in the middle east and north Africa. Over the past few weeks, we have witnessed events of a truly historic nature in the region, including changes of Government in Tunisia and Egypt, and widespread calls for greater economic development and political participation.

Last week, I visited Tunisia, Jordan, Yemen, Bahrain and the United Arab Emirates to discuss the situation with our partners in the region. I held talks in Tunis with interim Prime Minister Ghannouchi, who is overseeing ambitious plans to open up Tunisia's political system, reform its constitution, revive its economy and prepare for free elections. I strongly welcome those intentions, and the steps that the Tunisians have taken to sign up to international conventions on human rights.

I met some inspiring young students, whose motivation was a desire for the freedom, employment and human dignity that we enjoy in Europe. I believe that there is now a clear opportunity for a closer relationship between the United Kingdom and Tunisia. I discussed how the UK might support projects in Tunisia through our new Arab partnership fund. New funding was announced to the House on 1 February that will support economic and political development across the region.

In Egypt as in Tunisia, there is now a precious moment of opportunity for the people to achieve a stable and democratic future. Yesterday, I spoke to Egyptian Foreign Minister, Ahmed Aboul Gheit, and the Prime Minister, Ahmed Shafiq. I welcomed the statements of the higher military council that promised a peaceful transition to civilian and democratic government, new elections and the reform of the Egyptian constitution.

Tahrir square is calm today after yesterday's announcements of the dissolution of Parliament and the suspension of the constitution. I encouraged the Egyptian Government to make further moves to accommodate the views of opposition figures, and was pleased to hear from Prime Minister Shafiq that members of the opposition should be included in a reshuffled Cabinet during the next week. We would also like to see a clear timetable for free and fair parliamentary and presidential elections, and a genuinely inclusive dialogue about the country's future. We welcome the military council's commitment to all regional and international obligations and treaties.

Egypt is a sovereign country, and we must not seek to dictate who runs its affairs, but we have been clear throughout this crisis that it is in our national interests as well as Egypt's for it to make a successful transition to a broad-based Government and an open and democratic society, and to an Egypt that carries its full and due weight as a leading nation in the middle east and in the world.

I believe that we have been right to speak particularly strongly against repression of, or violence against, protesters, journalists and human rights activists. We call now for the release of those detained during the demonstrations and for steps to end the state of emergency, which curtails basic rights. The UK must always uphold the right to peaceful protest and freedom of speech.

14 Feb 2011 : Column 715

Looking to the future, it is vital and urgent that we work with the EU and other nations to support economic development and more open and flexible political systems in the region. We have begun discussions with the United States on co-ordinating our assistance. The Prime Minister discussed that with President Obama this weekend, as I did with Secretary Clinton. We can help with the building blocks of open societies, knowing as we do that a stable democracy requires much more than just holding elections. We are also working closely with Baroness Ashton and her officials. A taskforce has been set up in Brussels to put together a plan for immediate assistance and long-term support for Tunisia, and a plan of long-term economic and institutional assistance for Egypt.

The UK Government is in close communication with the International Monetary Fund and the World Bank to ensure that they are doing all they can to provide appropriate and timely support to Egypt. We have also received a request from the Egyptian Government to freeze the assets of several former Egyptian officials. We will of course co-operate with this request, working with EU and international partners as we have done in the case of Tunisia. If there is any evidence of illegality or misuse of state assets, we will take firm and prompt action. My right hon. Friend the Chancellor of the Exchequer will discuss economic support and possible freezing measures relating to assets with European Union finance Ministers tonight and tomorrow in Brussels, and has requested a discussion at ECOFIN tomorrow.

I hope that the House will also join me in paying tribute to the staff of the Foreign and Commonwealth Office and those who over the past three weeks have calmly and professionally run our embassy within yards of Tahrir square, while assisting the departure of thousands of British nationals from Egypt, and to teams from the Ministry of Defence and the UK Borders Agency. We will keep our travel advice under constant review.

The changes taking place in the region provide opportunities that should be seized, not feared. In Egypt, a nation of more than 80 million people should soon have the opportunity to choose their President and their representatives democratically. In Tunisia, more than 10 million people may now finally have the opportunity to unleash the economic potential that their geographic location and talented population puts within their grasp, and to enjoy democratic freedoms.

But this moment is not without risk. Nowhere is that more apparent than in Yemen, where I spent a day in meetings with President Saleh and members of the Opposition. I had three clear messages to the Government there. First, we want them to make progress on national dialogue with the opposition parties, including agreement on changes to the constitution and action to address the grievances of people in Yemen. Secondly, we have asked for and are now examining a prioritised and budgeted development plan for poverty reduction from the Yemeni Government so that we can establish a multi-donor trust fund for Yemen and be confident that funds are properly used. These issues will be the main focus of the next Friends of Yemen meeting in the coming months.

We also look for intensified Yemeni efforts against the al-Qaeda threat on their territory. I know that the House will salute the courage of our embassy staff in 14 Feb 2011 : Column 716
Yemen, who face the highest threat of any of our posts overseas and were attacked twice by terrorists in the last year.

There is also a serious risk that Governments will draw the wrong conclusion from instability in the middle east and pull back from efforts to restart the peace process between Israelis and Palestinians. We should draw the opposite conclusion, which is that we need to see an urgent return to talks so that people's legitimate aspirations for two states can be fulfilled through negotiations. This was the main subject of my discussions with King Abdullah of Jordan, as well as the recent steps the Jordanian Government have taken to promote domestic reform. In a region of uncertainty, the certainty provided by an agreement between Israelis and Palestinians would be of immense significance.

The Government are a friend to both Israelis and Palestinians. We are calling for both sides to show the visionary boldness to return to talks and make genuine compromises. Talks need to take place on the basis of clear parameters. In our view, the entire international community, including the United States, should now support 1967 borders as the basis for resumed negotiations. The result should be two states, with Jerusalem as the future capital of both, and a fair settlement for refugees.

Finally, we must not allow our attention to be diverted from the grave danger of Iran's nuclear programme. Iran claimed that it supported protestors in Egypt, but it has denied its own people the right of free expression today and placed opposition leaders under house arrest. Meanwhile, the threat from its nuclear programme has not diminished. Given Iran's refusal to engage in genuine negotiations over its nuclear programme at the recent talks in Istanbul, we are now in talks with international partners about steps to increase the legitimate peaceful pressure on Iran to comply with UN Security Council resolutions and the requirements of the International Atomic Energy Agency.

All the issues that I have described underline how important the region is to our national interests. That is why we began, from our first day in office, a major, long-term effort to intensify Britain's links with the countries of the middle east, north Africa and the Gulf -in diplomacy, trade, education, health and civil society -as part of a distinctive British policy towards the region.

I reaffirmed last week to leaders in Bahrain and the UAE that we are committed to intensifying our engagement on foreign policy and that we will step up our discussions with the Gulf states on Iran's nuclear programme over the coming months. We will also pursue firm engagement with countries where we do not see eye to eye but have a considerable interest in edging those states towards a more constructive role. That was a process that I began when I visited Damascus two weeks ago for talks with President Assad. At this time of opportunity and uncertainty, the UK will therefore be an active and distinctive voice in the middle east. We will send a constant message about how important it is to move in the direction of more open and flexible political systems, and sound economic development, while respecting the different cultures, histories and traditions of each nation. Although we cannot set the pace of this change and must respect each country's right to find its own way, we will be a reliable friend and partner to all those looking to do so, and a staunch defender of Britain's interests in the region.

14 Feb 2011 : Column 717

Mr Douglas Alexander (Paisley and Renfrewshire South) (Lab):
I thank the Foreign Secretary for prior sight of the statement he has just offered to the House. I welcome several aspects of the statement and join him, of course, in praising the work of officials in the Foreign and Commonwealth Office on the ground in Egypt and, in particular, the bravery of British staff working under difficult circumstances in Yemen. I also welcome the discussion of the use of the new Arab partnership fund and the work under way to co-ordinate international efforts to provide appropriate and timely support to Egypt. I also welcome the Foreign Secretary's remarks last week emphasising the continuing importance of the middle east peace process-sentiments that he has echoed again today-and his continued efforts to help to address the continuing challenges facing Yemen and the grave threat of Iran's nuclear programme.

As we watched a moment of history unfold on our television screens on Friday night, few of us would not have sensed history being made amid peaceful celebration and a genuine sense of hope and possibility communicated by the people of Egypt. Old certainties-political, regional and strategic-have been challenged by the scenes of hundreds of thousands of people on the streets of Cairo and elsewhere in the Arab world demanding a fundamental change in the relationship between the governed and their governments. I would therefore like, in particular, to address three points covered by the Foreign Secretary's remarks. The first is the work that the Government are doing, in conjunction with the interim Egyptian Administration and the Serious Fraud Office, to ensure that assets wrongly taken from either the people of Tunisia or the people of Egypt are pursued and returned. The second is the British Government's position on the future of Egypt going forward, and the third is the implications of all these events on the wider region and the middle east peace process.

Earlier this month, it was reported that the assets of 46 allies and relatives of former President Ben Ali had been frozen following talks with the Tunisian Government. Will the Foreign Secretary confirm that this has indeed gone ahead, and update the House on the work of British and European Union officials to ensure that any assets wrongfully appropriated from the people of Tunisia by former President Ben Ali are returned to them? In recent days, there have been many media reports suggesting that former President Mubarak has a very large personal fortune held in bank accounts and property in the United Kingdom and Switzerland, among other countries. Yesterday, the Business Secretary said:

"I think it would be great for the reputation for the City of London if those accounts were frozen now."

Yesterday, the Under-Secretary of State for Foreign and Commonwealth Affairs, the hon. Member for North East Bedfordshire (Alistair Burt) stated on the radio:

"There has to be a request made for any of this action to take place... There are things that can be done, but so far there has not been a request made and therefore it is not possible to speculate".

I note, however, from the Foreign Secretary's statement to the House this afternoon, that a request has now been received from the Egyptian Government. Will he therefore tell the House precisely when the request was received and what subsequent actions the Government have taken to freeze the relevant assets since its receipt? Will he inform the House what instructions have now been given to the Serious Fraud Office in the light of the 14 Feb 2011 : Column 718
request, and when the SFO began its actions in relation to the matter? Given the comments earlier today from the chairman of the euro group, Jean-Claude Juncker, supporting an asset freeze, will he explain the need for a delay in taking action before tomorrow's meeting with European Finance Ministers? Why cannot this issue be addressed through direct contact and agreement with capitals prior to the meeting taking place? For the assurance of the House, will he confirm that he agrees with the Opposition that the UK should play its part in ensuring that any money that rightly belongs to the Egyptian people is returned to them?

Let me turn to the broader issue of Egypt's future. The events of Thursday and Friday last week were extraordinary, but the question dominating our debate is: what comes next? The Foreign Secretary expressed his support for a clear timetable, but what is the British Government's specific policy on the timing of the elections? Should they follow the timetable set out by President Mubarak on Thursday, or is it the Government's view that a longer transitional period would now be more appropriate? Important as they are, free and fair elections alone do not guarantee effective democratic governance, which involves the vital and unglamorous task of building a series of institutions, as we heard, from diverse political parties to a free press, and from legal safeguards for human rights and minorities to an independent judiciary.

During that transition, are the Foreign Secretary and his officials pressing the higher military council for the emergency laws to be removed and detainees freed, and for maximum freedom to be given to political parties and trade unions to organise in preparation for democratic elections? The polarising policy adopted by the Mubarak regime undermined moderates and ensured that perhaps the two most powerful and enduring post-Mubarak power structures in Egypt are the military and the Muslim Brotherhood. Have officials from the Foreign and Commonwealth Office met the Muslim Brotherhood in recent days? Will the Foreign Secretary give us his latest assessment of the nature of the organisation and the strength of its support in Egypt, and say how he assesses its potential impact on Britain's objectives for the region, which he set out for the House today?

Let me turn briefly to the consequences of these developments on the wider region. The Foreign Secretary met the Government of Yemen in recent days. Will he offer us the latest security assessment of the threat posed by al-Qaeda in the Arabian peninsula? Having attended the London Friends of Yemen conference in my capacity as Secretary of State for International Development, I am aware of the challenges faced in Yemen, so will he update the House on how British resources are being used, ahead of the establishment of the multi-donor trust fund, to address the development and security challenges faced in Yemen?

I welcome the reference made by the Foreign Secretary to the situation of the Iranian opposition leader Mir-Hossein Mousavi, who has reportedly been placed under house arrest in order to prevent him from attending demonstrations in Tehran. Will the Foreign Secretary share with the House what further steps he is contemplating in speaking up for human rights in Iran? He has expressed his rightful concern about the grave danger of Iran's nuclear programme, so will he update the House on his assessment of the prospects for the E3 plus 3 process, given the disappointing failure of the talks in Istanbul?

14 Feb 2011 : Column 719

The announcement of the formation of a new Cabinet of the Palestinian Authority, combined with the planned presidential and legislative elections in September, is widely perceived as yet another consequence of the events in Tunisia and Egypt of recent days. The chief Palestinian negotiator, Saeb Erekat, also reportedly offered his resignation on Saturday, although reports suggest that Mr Abbas has not yet accepted it. Will the right hon. Gentleman tell the House what the situation is in the Palestinian Authority, and say what further information he has about the timing of those elections?

For many involved in the peace process from the Israeli side, the events of the last few weeks will have been unsettling. Although the cold peace with Mr Mubarak was the foundation of Israel's regional security, the events of recent days show just how brittle that supposed stability was. What discussions has the right hon. Gentleman had with his Israeli counterpart on the subject, and what he has done to urge the Israelis to see recent events as an impetus for a renewed commitment to the peace process? I am sure that I speak for all parts of the House when I say that, for the region, a peace one day between the legitimate representatives of the people of Egypt and a secure Israel would be an even greater prize than the last 30 years of stability.

Mr Hague:
The right hon. Gentleman asks a wide range of questions, and I shall try to go through them. I thank him for his words about the staff of the Foreign Office, and about what they have done and continue to do in Yemen, as well as in Egypt. I know that it will mean a lot to them to be appreciated in all parts of the House.

I also thank the right hon. Gentleman for his support for what I have said about the middle east peace process. As I understood it, he supports the intensification of our measures on Iran, which I talked about in my statement. These are conscious changes in policy. It is a conscious change in policy for not only we, but the United States to say that a settlement in the middle east should be based on 1967 borders. It is a conscious change in policy to say that now, on top of the measures agreed in the European Union last year, the peaceful pressure on Iran must be intensified. To be joined by the Opposition in those changes of policy gives strength to them, and it always counts for a great deal in foreign policy for this House to speak in a united way.

I might have to take the right hon. Gentleman's questions in reverse order, but I will try to get through them all. This leads us naturally to a discussion of the peace process, which I have discussed with my Israeli counterpart. Foreign Minister Lieberman visited London on 24 January, and we have also had more recent discussions with the Israeli Government. Indeed, the Secretary of State for Defence, my right hon. Friend the Member for North Somerset (Dr Fox) was there over the weekend, underlining the point that the events in the region strengthen the case for making a success of negotiations on a two-state solution. I hope that recent events will be a jolt to many among the Israeli and Palestinian leaderships, showing them that, in the next few years, the opportunity to find a two-state solution will slip away unless there is a renewed readiness to engage in the process.

14 Feb 2011 : Column 720

I am concerned about instability on the Palestinian side of the negotiations. The right hon. Gentleman mentioned the reported offer by the Palestinian chief negotiator to resign. There is also the prospect of elections among the Palestinians. This instability also underlines the importance of finding a way of getting the direct talks going again soon. The United Kingdom is very active diplomatically in trying to do that, and we will continue to be so.

The right hon. Gentleman asks about the prospects for the E3 plus 3 negotiations with Iran. There will be prospects for those negotiations only if Iran approaches them entirely differently from the way in which its negotiators approached the meeting in Istanbul on 21 and 22 January. The preconditions that Iran set for that meeting were entirely unrealistic, as Iran knew. It is important that it should be prepared to discuss its whole nuclear programme with the E3 plus 3 if such negotiations are to succeed. The door remains open to negotiations with Iran, but, so far, it has not proved willing to enter it.

The right hon. Gentleman asked about Yemen. There is of course a serious threat to our national security from the operations of al-Qaeda in Yemen. The recently well-reported cargo bomb plot was evidence of that. We are active in Yemen. The right hon. Gentleman will be familiar with the fact that the Department for International Development is very active there, with £50 million of support in the current year helping to provide more schools, to increase the number of doctors and to help with microfinance projects. That is valuable work, but we could do a lot more if we had the agreed framework of working with Yemen that we are calling for through the Friends of Yemen process, including the detailed development and poverty reduction plan. We received details of that plan just as I arrived in Yemen, and we are now examining it. I regard our work on the affairs and stability of Yemen in the coming months to be of great importance in the conduct of our foreign policy.

We certainly agree with the right hon. Gentleman's points about the future of Egypt. I think I mentioned in my statement that we want detainees to be freed. We also want to see a clear timetable for elections. There is an expectation that they will take place in six months, but not yet a categorical commitment. It would be wise to meet that expectation. As he and I have both said, however, democracy is more than about holding elections. What matters even more than the date is that the process between now and then should allow new political parties and civil society in general to grow and prosper. That is why it is important that emergency laws should be lifted, and that we and other nations-not only European nations but democratic Muslim nations such as Turkey and Indonesia-should join in the building up of civil society in Egypt. As the right hon. Gentleman said, that space between the National Democratic party and the Muslim Brotherhood has not been filled before. The Opposition parties in Egypt are small and weak.

We retain, as the previous Government did, certain contacts with the Muslim Brotherhood-in particular with those who were elected Members of Parliament in the 2005 elections. There has been normal contact with them, and that contact continues. Those people have clearly taken part in recent events in Egypt, although they are insistent that they will not be contesting the presidency of the country. We will maintain our contact with them, and judge them by their behaviour.

14 Feb 2011 : Column 721

The right hon. Gentleman asked about the seizure of assets. Yes, the requests made by the Tunisian Government are being acted on. The freeze has been implemented, investigations are taking place, and the ways in which our authorities should co-operate with that are being followed up.

The specific request from Egypt was received this morning. That is why there is a difference between what the Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for North East Bedfordshire (Alistair Burt) said on the radio yesterday, when that request had not been received-and had certainly not been seen by Ministers-and the information put out this morning, which is that such a request has been received and will be acted on.

To clarify an issue for the right hon. Gentleman, it is not the Serious Fraud Office, but the Serious Organised Crime Agency that is involved in the investigation of assets acquired through corruption. We, of course, have to abide by the law on this matter. That means that we will act on requests from foreign countries, but that Ministers can direct an investigation or a seizure and freezing of assets only if they are in possession of evidence of criminal activity or of a threat to our national security. We are under certain constraints if no request is received. Nevertheless, the European Union is able to implement an assets freeze for wider purposes, which is what my right hon. Friend the Chancellor is discussing with his colleagues in the EU tonight. We are acting on this expeditiously, and I thoroughly agree with the general sentiment that the right hon. Gentleman expressed about this issue.

Sir Malcolm Rifkind (Kensington) (Con):
In unreservedly welcoming the Egyptian revolution and similar uprisings elsewhere in the middle east, may I commend the Foreign Secretary, his predecessor and, indeed, the United States Government for insisting on having good working relationships even with autocratic regimes in the middle east which, regardless of their internal affairs which we deplore, have pursued moderate and constructive policies, seeking dialogue with Israel and working in a peaceful way towards a two-state solution between Israel and Palestine? Does the Foreign Secretary agree that any other approach would never have served the best interests of that region?

Mr Hague:
I agree with my right hon. and learned Friend. That is the policy he pursued when he held my office. It is important to do that in any practical approach to foreign policy. In fact, I would go a little further than my right hon. and learned Friend, as it is also important to have some kind of dialogue with autocratic regimes even when they have not always pursued moderate and sensible policies. As I mentioned, I visited Syria just over two weeks ago, where, of course, we disagreed. I disagreed in our meetings with President Assad about Syria's relationship with Iran, about the country's human rights record and the about the situation in Lebanon. Even with such countries, however, it is important to have dialogue. Diplomacy in foreign policy is not just about talking to people with whom we agree.